Australian wages growth slows to a crawl

Australian wages, including both private and public sectors, grew +0.589% in Q3 with the annual rate slipping to +2.577%. The quarterly increase was the lowest seen since Q3 2009 with the annual rate the lowest in the history of the survey.

While there were mixed performances across the country, New South Wales, Tasmania and the Northern Territory all recorded small year-on-year increases, it is clear that wages growth is trending lower. Mining States, clear beneficiaries of the mining CAPEX boom, are experiencing strong wage disinflation whilst the ACT, second only to Western Australia in 2012 for wage inflation, now has annual growth below the rate of inflation.

The performance of individual sectors is shown below. Surprisingly construction lags the national average despite strength in residential activity – clearly there is plenty of slack from the winding down of the mining construction boom, while retail and scientific/technical workers are experiencing the slowest wage inflation. On the topside those working in utilities, education and health all recorded growth well above the national average.